Clients benefit from independent advice

Mr Bradley suggests that advisers should perhaps charge an hourly rate for any size investments but, even if the hours were the same, a firm so charging would not be around for very long. Imagine the compliance, regulatory and professional indemnity costs relating to 10 £30,000 investments as against 10 £3m investments.

Like many of us, I have been stung by other ‘professionals’ that charge an (often unfettered) hourly rate, a process that is now held up as being the ideal model. And I imagine it would be difficult to find a solicitor who would charge the same to convey a £100,000 property as a £10m one. I am proud that our clients get the option of a fixed, known fee that they are free to compare and then decide whether it is fair value.

Regarding Mr Bradley’s comment regarding what clients would be prepared to pay, a few years ago the FSA’s customer research on RDR showed that clients were willing to pay a fee, but that they thought a fair one was less than £100. The former point was well publicised by the FSA, the latter was not. Aside from wondering who it asked and how the question was framed, fortunately there still seems to be plenty of intelligent, informed investors who see the benefit of independent advice (even if RDR has driven up the cost of it).

Mark Osland,

Director

Formula

South Croydon